For a given positively sloped supply curve, the price increase to consumers resulting from a specific tax imposed on sellers will be
A) greater the more price elastic demand is.
B) greater the less price elastic demand is.
C) equal to the entire tax when demand is perfectly elastic.
D) equal to half of the tax whenever demand is unit elastic.
B
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Workers earn more than half of the income generated by the production process.
Answer the following statement true (T) or false (F)
“The market has failed to provide enough rental housing in New York City. This demonstrates another failure of free markets-they may lead to shortages of necessities.” Explain why you agree or disagree.
What will be an ideal response?
A government surplus is
A) when it spends more than its income. B) when it owes more than what it is owed. C) when its income is higher than its spending. D) when it is owed more than what it owes.
Suppose hamburger is an inferior good, but not a Giffen good, for Bob. If the price of hamburgers increases,
A) the income effect is greater than the substitution effect. B) the income effect is smaller than the substitution effect. C) consumption of hamburger will increase. D) We are unable to judge the change of hamburger consumption.